CASH 2018 Special Proxy Statement

CRESTMARK MANAGEMENT’S DISCUSSION AND ANALYSIS OF CRESTMARK’S FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion describes the results of operations for the years ended December 31, 2017, 2016 and 2015 and also analyzes the financial condition as of December 31, 2017 as compared to December 31, 2016 for Crestmark and its subsidiaries (referred to in this section as “Crestmark”). This discussion should be read in conjunction with the “Selected Historical Consolidated Financial Data of Crestmark” and the audited consolidated financial statements and accompanying footnotes thereto included elsewhere in this joint proxy statement/prospectus. Historical results of operations and the percentage relationships among any amounts included, and any trends that may appear, may not indicate trends in operations or results of operations for any future periods. Crestmark from time to time makes various forward-looking statements with respect to financial and business matters. Comments regarding Crestmark’s business that are not historical facts are considered forward- looking statements that involve inherent risks and uncertainties. Actual results may differ materially from those contained in these forward-looking statements. For additional information regarding cautionary disclosures, see “Cautionary Statement Regarding Forward-Looking Statements” beginning on page 18 of this joint proxy statement/prospectus. Overview Crestmark is a registered bank holding company that provides working capital solutions through its wholly- owned subsidiary, Crestmark Bank. Crestmark Bank is a Michigan-chartered banking institution that specializes in the provision of commercial lending and leasing products to business customers throughout the United States. Crestmark Bank conducts its business through its headquarters in Troy, Michigan and a network of loan production offices in Los Angeles, California; Boynton Beach, Florida; Baton Rouge, Louisiana; New York, New York; Franklin, Tennessee; and Toronto, Canada. Crestmark is a non-cash bank and does not maintain a traditional retail branch or deposit network. Crestmark is primarily reliant upon brokered deposits and internet listing services as sources of capital, which are supplemented by internet-based retail and commercial deposits. Its primary lending products are commercial asset-based loans, leases, and accounts receivable purchasing (factoring), both discount and traditional. The profitability of Crestmark’s operations is influenced heavily by its net interest income after provision for credit losses, which is the difference between interest earned on interest-earning assets and interest paid on interest-bearing liabilities less provision for credit losses. The provision for credit losses is dependent on changes in the financing receivables portfolio and Crestmark management’s assessment of the collectability of those receivables, as well as current and future economic and market conditions. Additionally, Crestmark’s net income is impacted by non-interest income, non-interest expense, and income tax expense. Critical Accounting Polices The consolidated financial statements of Crestmark are prepared in accordance with U.S. GAAP and are consistent with general practices within the depository institutions industry. The application of U.S. GAAP requires Crestmark management to make certain estimates, assumptions, and judgments based on information available as of the date of its financial statements that affect the amounts reported in the consolidated financial statements. Accordingly, as this information changes, actual results could differ from the estimates, assumptions, and judgments reflected in the consolidated financial statements. Critical accounting estimates are those estimates that Crestmark management believes are the most important to the financial position and results of operations. The most significant accounting policies and estimates are presented in Note 1 of the audited consolidated financial statements of Crestmark included in this joint proxy statement/prospectus. These consolidated financial statements and related footnotes provide 107